Bureaucrats get $6bn gift during austerity

Julian Wolfe
July 6th, 2012

It appears that you don’t necessarily have to be a bureaucrat who’s losing a job to get a severance package. While the Conservatives are cutting Canadian services, they are giving their friends in the bureaucracy a $6 billion in bonus and a pay raises.

The bureaucrats that didn’t get the letter notifying them that they will be laid off will be laughing their way to the bank to cash checks worth up to $150,000 in severance, along with a pay raise. These thousands of public employees didn’t even change jobs!

Government officials say that the average payout was $20,000 but higher paid executives and military officials got their hands on $150,000 severance checks.

The Conservatives are so quick to give checks to well off bureaucrats who should be first in line with pay cuts and losses in entitlements but the same money that they handed out to thousands could have been given to homeless people who would have had more use with the money than bureaucrats who believe in entitlements.

Thousands of soldiers who aren’t even entitled to severance will be getting their gifts anyway and by the end of this year, up to $2 billion will have been distributed.

The Conservatives pulled this move in an attempt to mull over those who may be infuriated with the fact that they are abolishing a long standing entitlement that gave federal workers severance – even when they quit or retire.

The Treasury Board says that while $6 billion may be a large upfront sum, tax payers will be saving $500 million per year. In other words, it will take 12 years to pay off this nice $6 billion sum.

“The savings for Canadian taxpayers are significant,” Treasury Board Minister Tony Clement said in a written statement to CBC News. “The government is no longer liable for future accumulation of voluntary severance payouts that would continue to climb.

“This benefit does not exist in the private sector and there is a reason. It is costly and to perpetuate it would be unfair.”

But while it may look great on the outside – on the 13th year we see savings! The reality is that much of the $500 million per year savings will be eaten up by the 0.75% salary increases – which weren’t at all justified.

“To spend billions of dollars in severance package for people that are not losing their jobs,” said Dan Kelly, head of the Canadian Federation of Independent Business, “people that have the best form of job security in the country, that have gold-plated pensions to leave to, just seems nuts.

“This should be taken away from civil servants.… But to trade it off for higher wage increments, I think will not pass the smell test for average Canadians.”

However, the union representing these bureaucrats differs in opinion and welcomes the payouts.

“The present government decided to end the accumulation of severance and negotiated a compensation package with some federal government workers,” said Robyn Benson, national president of the Public Service Alliance of Canada.

“At the same time, PSAC negotiated stronger provisions for severance upon layoff so the thousands of federal workers this government is recklessly cutting have a better chance of continuing to pay their mortgages and contributing to the economy.”

Barry Ferguson represents a large number of bureaucratic customers as a Toronto financial consultant.

“The payouts that we’ve seen that we’re talking about are somewhere in the $40,000 to $80,000 range. So, you know, these are not life-altering amounts of money, but they can certainly be life-enhancing amounts of money.”

While these bureaucrats are getting a gift from Harper, the 19,000 that Harper decided to fire will only be getting $900 million in severance.

Truth is, Harper is right for abolishing the perk but the severance giveaway and pay raises were an absurd replacement. It appears that Harper wants to look like he’s doing the right thing, while at the same time trying to defend his friends in the bureaucracy who really should be getting the boot and should be losing their benefits – not getting replacements for them.

Want to start with austerity Mr. Harper? Start with the entitlements that public sector workers and MPs get. Scrap the golden pensions and benefits and then come back to the Canadian people and preach austerity.

Do you think it’s justified that you will have to wait 2 years more for your pension when these people literally got checks in the mail for no good reason?

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   Categories: Bureaucracy, Government Mismanagement, Spending


On Monday, the longest campaign in modern history will come to a close and if current polls are any indication, Canada may be seeing a change in government after 9 years of Conservative rule under the leadership of Stephen Harper. Accountability was his calling card in 2006 and today, accountability may very well be one of the defining reasons for his departure.

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